Sell house, buy more expensive, and invest?

[Zeratul]

edit:
Thanks all. Sound advice

[Viking Thor]

Do your parents want to move to a different house? If they do- why would they give you the proceeds from the sale to invest? (Understand you have intention to pay of their new mortgage later, but  still...)

This does not sound like a good idea. If you were changing houses, and investing the difference, that could make sense. It just doesn't seem like something that would benefit your parents and could create a lot of needless uncertainty for them. They would go from 100% paid off house to a more expensive 20% paid off house.

[MightyAl]

Man all that to move 10 miles. That is an awful lot of risk to take on for that short distance.

Why don't you move in together? 

[Viking Thor]

Avg stock market return depends on time period selected and type of stock (total U.S., S&P 500,, Global, etc.), but 11.9% is high  based on historical average and very optimistic now given that stocks are highly valued. No one can predict future, but most experts think returns in near/ medium term will be lower than historical average given current high valuations.

Also, stock returns have huge variability and could be flat or even decline over short time periods.

This seems to be risky for both you and your parents.

[ShoulderThingThatGoesUp]

This is a lot of mixing of your and your parents' finances.

If you don't want them to have to do maintenance they should rent.